M"n:>DAUGH "'. BACHELDER
(C'ircuit Oourt, D.
VJllNDOR AND VENDEE-MORTGAGED· PROIJJllRTy-PAYMENT OF }lORTGAGlll.
Where vendees buy a 'piece property fllr certain sum, bu' 'with no understanding or agreement· til at they are to pay the mortgage sa , ... &ipartof the consideration, they are not liable to their vendor. the mortgagor, . .yh,q has been compelled to pay the mortgage debt.
,G. Nichols and O. K. Cobb;. for plaintiff. for
COLTj'J. ,This case was heard by the court, jury trial having been waived. It appears that on June 26,1866, the plaintiff made a mortgage note for $1,200, payable to the order of John Dorchester, secured hy, a: deed ,Of trust of certain land .situated in Chicago, Illinois, which was Iduly recorded; " Subsequently, on November 19, 1866, the plaintiff con1/eyed by deed to· one of the :defendants John Q. A. Bachelder the same premises subject to saidroortgage. Some months after Bachelder.conveyed. the same premises to his brother Cyrus T.Bachelder, the other defendant,· subject to the same mortgage. In December, 1&78, Dorchester; the mortgagee, brought suit against the plaintiff in the circuit court for Cook county, Illinois; for the amount of said note, and interest" and in November, 1882, judgment was rendered against the plaintiff for $2,407.97, and costs, which judgment was satisfied December 18, 1882. The present suit is brought to compel the defendants to pay the mortgage debt 011 the ground of an implied contract arising out of the purchase of the land from the plaintiff. The position taken by the plaintiff is this, that under the laws ,of the state of lllinois, where real estate upon which there· is a mortgage is sold for a given price, and the amount of the mortgage is deducted from the purchase money and left unpaid in the hands of the purchaser, :the law treats the amount so deducted from thepurchasermoney as being :left in the hands of the purchaser for the purpose· of paying the incumbrance,and implies a .promise on his part to pay the incumbrance with, the portion of the purchase money left in his hands. In the present case, the consideration mentioned in the deed from the plaintiff to Bachelder was $7,891.65, and the deed contained the following provision:
.. This deed is given subject to the conditions of two certain trust deeds, the first is given by Henry C. Middaugh to Tbos. D. Snyder, dated June 26, 1866. in the sum of $1200, and recorded in the recorder's office of Cook county, Illinois, .July 9, 1866; and the second by Henry C. Middaugh to George Scoville in the sum of $2420, dated July 2,1866, and recorded July 6th in said recorder's office."
The amount of cash paid by Bachelder was 84,000.
This case turns upon the nature of the contract which was made be· tween the parties. If it was a mere purchase for $4,000 of the equity of redemption by Bachelder,then it is clear he is not liable in this suit. On the other hand, if it was understood that the purchase money for the property was $7,891.65, and th4;l amount, after deducting $4,000, was left in purchaser's hands for the payment of the two mortgages, or if, by the terms of the deed, the purchaser was to pay the mortgages, then the defendant could be held in this suit. The deed appears to in the ordinary form, and contains no such undertaking on the part of the purchaser. Nor does the plaintiff prove that the price forthe property was $'7,891.65, and that the sum remaining aftel $4,000 was left in purchaser's hands to liquidate the mortgages. The facts are that plaintiff left this property for sale in the hands of hi&" agents, Snyder and Lee, and the saJe was made through them. Neither of them is called as a witness. The defendant John Q. A. Bachelder swears that Lee sold him the equity in the land for $4,000, and that nothing was said about assuming to pay any mortgage. What the plain. tiff may have thought about the nature of the contract, or what he may have told his agents, is immaterial to the issue here. He left the mat. tel' in the hands of others. The sum named as the consideration in thf' deed is by no means conclusive of the fact that the payment of outstanding incumbrapces constituted part of the purchase money, and so bound the purchaser to pay them. . Nor does the recital in the deed that it ill given subject to certain mOrtgages prove this. The plaintiff must show an agreement on the part of the defendant that these incumbrances were intended to be. a part of the purchase money. In the ordinary case of the purchase of land, 8ubjectto mortgage, there is no implied promise on the part of the purchaser to pay the mortgage debt. 'I'he cases cited by the plaintiff do not sustain his position. In TwicheU v. Mears, 8 Biss. 211, there was an express recital in the deed that the mortgage was a part ofthe consideration named, and Judge BLODGETT thus clearly defines the rule: "The rule is probably as contended by the defendant's counsel that the purchase of an equity of redemption from a mortgagor of real estate does not make the purchaser personally liable to the mortgagee. But where the payment of an outstanding incumbrance, created by the grantor, constitutes part of the purchase money, the law implies an undertaking by the purchaser to pay it, and the mortgagee may recover in assumpsit." In Comstock v. Hitt, 37 Ill. 542, the court holds that, in the absence of any agreement that the mortgage debt shall constitute part of the consideration, there is no implied promise to pay the debt; and to the same effect is FowlRfr v. Fay, 62 Ill. 375. In the present case, the plaintiff, having failed to prove any agreement on the part of the defendant that the incumbrances comtituted a portion of the purchase money, judgment must be entered for the defendants, and it is so ordered.
PLEDGE-AGREEMENT Fon COLLECTION-EFFECT.
Defendant executed notes to a, trust company, and delivered bonds and choses in action as coUater,sl ,security, The company signed an agreement regarding the securities, which provided that the ,proceeds arising from the sale of the securities and recovered from the choses in action should be applied to payoff the notes, subject to the repayment of moneys expended by the company in prosecuting claims or sellmg seQurities. Held that, under this agreement, the company was not bound to seU the bonds in the absence of any request to sell, nor to commence suits; nor was it bound to prosecute suits at its own charp;e and risk.
At Law. Motion for new trial. This aotion was brought by George Wilkinson, as receiver of the American Trust Company, against Delos E. Culver. OJu1'tlandt Parker, for plaintiff. R. Floyd Olarke, for defendant.
SHIPMAN, J. This is a motion by the defendant for a new trial of an action of debt upon judgment. The original action was upon sundry promissory notes of the defendant to the order of and owned by the American Trust Company. In this suit the defendant filed a counterclaim, in which he sought to recover damages against the plaintiff for the alleged violation by the trust company of its agreement with the defendant in regard to the property which was pledged to it as collateral security for the payment of said notes. On February 24,1876, the defendant executed and delivered to said company his five notes, amountin!! in all to $39,631.29, and also delivered to it certain railroad bonds, and assigned to it chases in action, as collateral security for the payment of said notes. The chases in action were his claims against individuals and a railroad corporation arising out of his contracts with them. The defendant drew a declaration or agreement in regard to said pledged property, which the trust company signed. This agreement, after describing the defendant's notes, and declaring that it held for his benefit certain choses in action, stock, arid bonds, which it described, contained the following clause: "The proceeds arising from the sale of said securities, and recovered from 'said choses in action, are to be applied to payoff said notes and interest, and the remainder is to be paid to said Delos E. Culver, or his legal representatives,subject to the repayment of moneys expended by said American Trust in prosecuting claims or selling the securities." Two of the claims were not prosecuted. A suit upon another claim had been instituted by the defendant, and was thereafter successfully prosecuted by the company at its expense. It is insisted by the defendant that the necessary implication of the contract is that the trust company was under an obligation to sell the securities, and to prosecute the claims, at its own risk and expense. No